To the editor,
I take exception to the headline in last week’s Glen Rose Reporter regarding the financial situation of the Glen Rose Medical Authority.
I base my comments on the actual financial statements and not the sugar coated version fed to the authority board and the media.
The real facts are this:
The operating bank account is overdrawn per books by $50,000 at Dec. 31, 2009.
The hospital owes about $1.2 million in accounts payable.
The balance sheet reflects $800,000 in “other receivables” – some of which may not be collectible.
The required capital improvements fund apparently has not been restored and, appears to be used to keep the operating account balance at the bank from showing as overdrawn.
According to the auditors, all bank accounts have not been reconciled though the out of balance condition has been reported before.
Based on the hospital’s own numbers, substantially all of the December profit was made up of “other income” of $390,000, which is likely one-time grant money designated only for restricted usage.
The authority’s budgeted deficit for this year is more than $1 million. Where will this come from? Would you believe likely out of the taxpayers’ pockets?
I have three strong recommendations to the authority board and the county commissioners.
First, insist on an outside audit of the operations for the period from Oct. 1, 2009 to Dec. 31, 2009, and the balance sheet as of Dec. 31, 2009. How can the authority board know what assets it is getting or all the obligations it is assuming without assurance of accurate financial statements and internal controls? Prudent policy decisions by the board require accurate and complete information.
Secondly, the underlying problems go beyond the financial statements and include day-to-day decisions by executives and management. I strongly urge the board to engage an independent consulting firm, experienced in hospital operations, to do an in-depth review of the entirety of the organizational structure and operations of the hospital, nursing home, and the so-called “501a Corporation” (I would point out that the “501a Corporation,” since inception, has drained about $1.6 million of cash away from the other entities ). Unbiased, independent advice is imperative before spending huge amounts of taxpayer money.
Finally, discussions regarding further capital improvements and major changes in operations (such as nursing home and rehabilitation operations ideas presented to the board) should be deferred pending completion and final payments for the present construction projects, the operational audit recommended above, as well as a decision whether a change in management is to be made.
Charles R. Thomas, Sr.